Allens, Freehills in latest record takeover bid

ALLENS ARTHUR ROBINSON is advised Wesfarmers on its $19.6 billion offer for Coles Group Limited by scheme of arrangement — the largest ever takeover offer in Australia.

ALLENS ARTHUR ROBINSON is advised Wesfarmers on its $19.6 billion offer for Coles Group Limited by scheme of arrangement — the largest ever takeover offer in Australia.

Freehills partner Rodd Levy was the lead partner that acted for Coles Group on the Wesfarmers bid.

The Coles Group board this week rejected the offer and launched a competitive bid process for interested buyers of the business, which may lead to a full sell off of the company or parts of it.

Allens’ lawyers on the deal include lead partner Ewen Crouch, partners Richard Kriedemann and David Wenger and senior associate Tom Story.

Some of the same team is acting for Qantas in the private equity bid for the airline and Crouch is also acting for Cemex in its $16.8 billion bid for Rinker Group, which was Australia’s largest takeover offer before the Coles bid.

Wesfarmers made its $16.47 per share bid together with a consortium including private equity houses Permira, Pacific Equity Partners and Macquarie Bank.

Coles also rejected an increased offer of $15.25 a share from US private equity firm Kohlberg Kravis Roberts (KKR) in October last year. KKR is now reported to be interested in making another higher bid for Coles.

If Wesfarmers makes a counter offer, together with its consortium partners, under the initial offer terms it would hold 50 per cent of Coles’ Everyday Needs businesses, which includes its supermarkets, liquor stores and K-Mart, and 100 per cent of Officeworks and Target.

Wesfarmers already owns Bunnings, the biggest hardware chain in Australia and the third largest retailer, and just prior to the bid acquired an 11.3 per cent stake in Coles Group.

Wesfarmers managing director Richard Goyder said if they win, the deal would not require any regulatory approval, with all proposed purchases remaining majority Australian owned.

“We believe the acquisition of Coles would be a very positive step for the shareholders of both companies,” he said in a statement.

“Wesfarmers has considerable retail experience in its own right through Bunnings … we believe that a change in ownership will provide a catalyst for an improvement in performance.”

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